Buy the Morning, Enjoy the Afternoon: A Fund Flow Effect?

By Brendan Conway

Stifel Nicolaus & Co. trader Dave Lutz points this morning to what he thinks could be mutual-fund inflows carrying the market lately. In that context, it’s worth noting that there hasn’t been a single week of stock-fund outflows all year.

In the last three sessions, the S&P 500 (SPY) moved progressively higher throughout the day, for no obvious reason except that traders weren’t ready to push stocks forcefully lower. It was most dramatic Thursday, when the Dow Jones Industrial Average (DIA) slumped by triple digits in the morning only to recover most of the loss by the close of trading. Somebody’s buying. But who?

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